Individual vs. Group Health Insurance: Moral & Financial Dilemma
July 17, 2008 8:43 AM   Subscribe

Moral, Economic & Logistical Health Insurance Question: Can/Should I switch myself and my son to a private health insurance plan from my (bad, expensive) group one even though that will result in my whole company losing their coverage?

It's time for health insurance renewals at my small (REALLY small: 4 employees) nonprofit in North Carolina. For the last two years I've been covered under their plan, which costs me about $200 a month and does not cover my 16 year old perfectly healthy son at all. They quoted me an additional $345 per month to cover him and I couldn't afford it; so for the last two years he's just gone without insurance. Obviously, this has to change and, since my insurance will now cost $250 a month and I absolutely do not have an extra $50 per month, this is the time to change it.

I've been researching individual plans and have found a couple that are really close to $200 and will cover us both. Granted, they are high deductible but frankly, we're both pretty healthy and I'd rather have us both covered than only one. So it would seem like a no-brainer to switch off the health insurance EXCEPT, and here is the clincher:

My work's insurance company has told us that since we are so small, if any one employee opts for no coverage, they will drop the entire group. "IF that employee has other group coverage (spouse, government such as Medicaid or Medicare) they can opt out. Otherwise on a group your size it must be 100% participation of all eligible employees." is the exact quote from my email last week when I inquired about this.

That would mean that two of my coworkers, who have major health issues, would be completely screwed. That's what has kept me from doing this for the last two years. I don't want to consign them to death and I kind of feel like I would be doing just that. But I'm tired of feeling like I'm depriving my child in favor of my coworkers. I thought of getting an individual plan for my son in addition, but that's going to cost at least $100 per month, which means I would have to come up with an additional $150 more per month than I am right now. I work for a non-profit; I make a non-profit salary and honestly I really can't afford even what I'm already paying. There is no way I could come up with $150 extra. To maintain the status quo and add an extra $50 per month is going to be nearly impossible and it makes me sick to think of paying more when I can't even add my own child. This is making me bang my head against the wall. Help. What should I do?
posted by mygothlaundry to Work & Money (17 answers total)
You have got to get insurance for your son. 16-year-olds are healthy, but they are in a high-risk group for accidents -- from skateboarding to motor vehicle. The cost for a broken leg can get very high, very quickly. It is too bad that it will adversely affect your workplace, but is your job going to pay your son's medical bills? Are they going to refuse to lay you off if their budget gets cut? Are your coworkers going to promise to not drop their insurance either?

You may want to call a meeting at work to let people know what is about to happen so they can spend some time looking at alternatives for themselves, but you need to make this decision based on your family, not your job.
posted by Rock Steady at 8:52 AM on July 17, 2008

The solution I see is to no longer be an employee of the company. You resign and then are hired back as a contractor at a rate equal to your salary.

Then it is still "100% participation of all eligible employees", your son has health insurance and nobody gets screwed.
posted by mikepop at 8:59 AM on July 17, 2008 [4 favorites]

I'm not sure this is altogether a bad thing for your co-workers. Why not give them a heads up and give them the names of the individual plans you've found? It'll very likely be cheaper for them, too, which they will probably appreciate.
posted by alpha_betty at 9:01 AM on July 17, 2008

You son may be eligible for state health insurance, depending on your income:
According to the pre-tax, monthly income guidelines valid from April 1, 2008 to March 31, 2009, a family of two may now earn $2,334 (a $52 increase from last year’s requirements), a family of three may earn $2,934 (a $72 increase); a family of four may earn $3,534 (a $92 increase), and a family of five may earn $4,134 (a $112 increase). Whether a child qualifies for Health Check or NC Health Choice depends on the family’s size and income from the previous month.
posted by rtha at 9:12 AM on July 17, 2008

It has been a LONG time since I worked on the health side of my company, but as I recall, the only time 100% participation could be required was for EMPLOYER paid benefits. When the ER is making the Employee pay for any portion of the premium, the employee is free to opt out. Are you sure your insurance company understands that your company is not paying 100% of the premium?

Your company can also shop around for a different insurer. Get coverage for your son! You are not leaving them with no options.
posted by peep at 9:16 AM on July 17, 2008

Has your institution looked into group plans through other organizations? I know American Association of Museums members can get insurance through one of their partners and that in Minnesota, the same goes for the Minnesota Council of Non-Profits. The rates aren't great compared to large group plans, but they do tend to be better that both what you describe and high deductible individual plans.
posted by advicepig at 9:19 AM on July 17, 2008

If peep is wrong and your leaving your employer's group plan would in fact cancel your co-workers their insurance, then you can tell your co-workers that you have to insure your son and can't afford to in the plan, and ask them if they'd rather get individual plans themselves or chip in to cover your continued membership and your son's individual plan.
posted by nicwolff at 9:24 AM on July 17, 2008

Bring this issue up with the others. See if the nonprofit can pay the difference. It's worth a shot. If not, then you have the option to walk away.
posted by mightshould at 9:26 AM on July 17, 2008

rtha, you're a genius. They've raised the eligibility guidelines - the last time I checked, I made $75 or so over the limit, but now I'm inside! This may save everything.
posted by mygothlaundry at 9:31 AM on July 17, 2008

You are providing a service to the other employees at your company by staying in the pool. That service comes at a detriment to you, financially. Basic economics says that they should pay you for this service. Either your company should cough up the money, or the individual employees who benefit should. It may seem crass, but you're giving them a huge benefit, and it shouldn't come at a cost to your son, who is innocent in all of this. You deserve to be compensated for the service you're providing to them, so that you can be made whole for the cost you've borne to benefit them. Tell them what this is costing you, and tell them that unless you receive additional funds to pay your son's premiums, you'll have no choice but to leave the pool.
posted by decathecting at 10:30 AM on July 17, 2008

Family comes before work. Period.
posted by ewkpates at 10:36 AM on July 17, 2008 [2 favorites]

I'll keep my fingers crossed for you, mygothlaundry - I knew that working at a health policy NPO would pay off somehow!
posted by rtha at 11:52 AM on July 17, 2008

Why don't you talk about this with your co-workers and the organization. Tell them that your situation. Either the organization or co-workers would contribute to your expense, if not you will have to go for the individual insurance.
posted by WizKid at 12:00 PM on July 17, 2008

I'm not sure this is altogether a bad thing for your co-workers. Why not give them a heads up and give them the names of the individual plans you've found? It'll very likely be cheaper for them, too, which they will probably appreciate.

If they have chronic health conditions, they will not be able to get on these plans. Believe me. They will suffer immense financial, physical, and psychological hardship.

I would suggest asking them for contributions as well. I would happily pay $100 a month to maintain health coverage. It would be so much cheaper than the alternative.

You've gotten some great suggestions. I hope it works out for everyone involved, and I'm sorry that our piss-poor government has put you in this awful situation.
posted by sondrialiac at 2:33 PM on July 17, 2008

How about talking to your employer about getting a health insurance plan that doesn't suck?
posted by gjc at 7:18 PM on July 17, 2008

Your obligation is what is best for your family, not your company. Give your employer and coworkers notice that you intend to get an individual plan for yourself and your son and opt out of the group plan if your employer does not improve the group coverage offered. Your coworkers can then add to the pressure on your employer to improve coverage or pay for a higher percentage of the premiums.

It's not your job to hurt yourself, your son, or your financial well-being to subsidize your employer or coworkers.
posted by Jacqueline at 2:53 AM on July 18, 2008

BTW, when we were shopping for a group plan for our company, we had a healthy young man who didn't need health insurance right then but would in 3 months. Given that including him on the plan at sign-up would lower everyone's rates over the next year by way more than the cost of 3 months of his premium, the company decided to just pay for his premium for the extra 3 months so we could lock in the low rate. If having you on the plan is benefiting everyone else but not you, then your company or coworkers should consider contributing towards your and your son's premiums.

The state plan idea rtha suggested may work for now, but will taking it mean that you can never accept a raise or you'll be screwed again? That's not a good long-term solution.

Who is in charge of health insurance for your company? They don't seem to be very competent if there are no cheaper options and so many restrictions. Maybe you can take on researching better group insurance as a group project. I would get a broker to help you, one who sells for lots of different plans and can help you find the best one. I think a lot of companies just buy their insurance once and never think about it again, when shopping around periodically could save them a TON of money.
posted by Jacqueline at 3:01 AM on July 18, 2008

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